Avanti Communications has already made it into orbit in its mission to improve
global internet coverage, the company's chief executive tells Sophie
Curtis

The second great space race is underway. This time, rather than putting a man on the moon, the aim is to make internet access available to the two-thirds of the world that are not yet connected.

The primary target is Africa, a continent with a land mass the size of the USA, China, India and Europe put together, but with a population of 1.1bn – less than India alone. The dispersed population means that traditional methods of internet delivery, such as laying fibre cables in the ground, are often expensive and impractical.

Satellite broadband provides a more economical solution because, although it is expensive to build and launch satellites, once they are in orbit they can provide internet access over vast areas, and rather than digging up the ground or erecting masts, a satellite dish is all that is required to receive a signal.

Meanwhile, Sir Richard Branson is supporting WorldVu's OneWeb project, which aims to put 648 micro-satellites into low Earth orbit to provide high-speed internet and telephone services, and Google has teamed up with SpaceX, founded by billionaire entrepreneur Elon Musk, which has a similar plan to provide internet access from space.

However, one British company is way ahead of the game. Avanti Communications, a London-based satellite operator, already has a satellite in space covering large parts of Africa – including South Africa, Zimbabwe, Kenya, Tanzania and Burundi – known as Hylas 2.

Above: Avanti's Hylas 2 satellite launched in August 2012, providing coverage across Europe, the Middle East and Africa

Another satellite, Hylas 3, will be live for commercial service in 2016, and Hylas 4 will launch in 2017, completing Avanti’s coverage of Sub-Saharan Africa.

“From the outset, Avanti’s business model was about Africa. The reason for that is the economics, the teledensity, the demographics of Africa strongly favour satellite,” said David Williams, chief executive and co-founder of Avanti.

“You also have a rapidly-growing middle class with the emergence of revenues from offshore oil and gas production, and growing demand for mining products. There’s plenty of capital in Africa now, so we think we’re in the right place.”

Mr Williams was interested in space from a young age. In 1969, aged just three months, he sat in front of the TV at home in Wales and watched Neil Armstrong take his first steps on the moon.

He went on to study economics at Leeds University, and after a two-year stint as the frontman of a rock band called The Watchmen, Mr Williams ended up moving to London and getting a job in the City, working for JPMorgan Chase. He was still keen to pursue his musical dream, but found he had no time to form a band.

“It was around that time that some kids I was at school with became famous. They were called Damon Albarn and Graham Coxon, and I watched Blur become the biggest band in the world thinking, I wish I’d done that,” said Mr Williams. “So I had this latent need to do something a bit more rock-and-roll than banking.”

Above: Seeing fellow classmates become famous in the band Blur gave Mr Williams the impetus to do something more 'rock-and-roll' with his life

It was while he was working as a corporate finance advisor in the late 90s, trying to raise money for satellite companies, that he met David Bestwick, an astrophysicist and “proper old-fashioned genius”, who was working for Marconi Communications, and with whom he ended up co-founding Avanti in 2002.

Over the course of the next four years, Mr Williams and Mr Bestwick petitioned the government to give them a chunk of high-frequency radio spectrum, in exchange for plugging the gaps in rural broadband coverage in the UK.

“Although we were just a couple of geezers in a garage, we convinced the government that we should be allowed to have this spectrum licence,” said Mr Williams.

“We explained that we would be the first country in Europe to have high-quality satellite broadband, meaning that everybody in rural areas could have all the broadband they wanted, plus we could sell the technology to other companies around the world. The government decided this wasn't an altogether stupid idea, so they gave us the licence.”

Avanti still had a lot of hurdles to overcome before it could start running a satellite broadband business. After being turned down by 234 venture capitalists, Mr Williams had to remortgage his house, take out a dozen credit cards and a £10k loan to get the company off the ground.

Above: the first Hylas satellite was launched into space in 2011

It wasn’t until 2011 that the first satellite, Hylas 1, was finally launched into geostationary orbit, providing broadband coverage across Europe. As well as providing internet access in areas where fibre couldn’t reach, Avanti’s satellite also served a range of corporate needs, such as providing remote site telemetry and backhaul for mobile networks.

However, one of the main drawbacks to satellite broadband is latency. Compared to fibre broadband, satellite experiences a delay of around 400 milliseconds, due to the signal having to travel 35,786 km to a satellite in geostationary orbit and back to Earth again.

For this reason, in areas where fibre broadband is prevalent, satellite is often regarded as a “fill-in” technology rather than a competitive solution. Although Mr Williams claims there are only a few situations where latency really matters – like high-frequency trading and real-time gaming – he knows the big opportunity is in places like Africa, where fibre is not an option.

When Avanti launched Hylas 2 in August 2012, it quadrupled Avanti's satellite capacity. The company can now provide coverage to 27 per cent of the world’s population, and it is doing work in Africa, in partnership with the UK Space Agency, to bring e-learning to 250 schools in Tanzania and improving air traffic safety across the continent.

Above: a girl at a school in Tanzania accesses the internet using satellite broadband from Avanti

The company is still not out of the woods financially. The Hylas satellites launched later than investors would have liked, and it has taken time for Avanti to sign up government and corporate customers in Africa. Such setbacks have resulted in Avanti’s share price falling by two thirds since the start of 2010.

However, Mr Williams claims to have a business plan that will deliver shareholders a lot of value in the next few years, by capitalising on the company’s lead to market and patenting its existing technology.

Despite the impending arrival of companies like WorldVu and SpaceX in Africa, Mr Williams claims to be “intensely relaxed” about competition, because the demand for broadband in Africa exceeds the supply by ten times.

He also claims there are a number of technical, regulatory and commercial challenges that WorldVu and SpaceX will need to overcome if they want to launch hundreds of small satellites into low-Earth orbit (anywhere between 1,000km and 10,000km above the Earth).

Above:A computer-generated image of objects in low earth orbit. There are an estimated 12,000 large pieces of trackable space junk

Although being closer to the Earth reduces latency, it also means the satellites do not remain in a fixed position above the ground, so if their orbits overlap there is a risk that they could collide. They also need to be brought back down to Earth when they run out of fuel because, unlike geostationary satellites, they cannot be drifted out into space.

“Flying hundreds of satellites around and de-orbiting them and hoping that they all work and they respond to their commands creates significant flight risk; it’s never been done before,” said Mr Williams.

“The largest constellation of low-earth orbit satellites in the world numbers about 60. These other projects would mean a ten-fold increase in the number of satellites flying around, and so the risk rises by more than 10 in our opinion.”

He added: “At the moment you essentially have some suppliers that would like Wall Street to pay them to build systems. We’ll see how the Wall Street investors feel about taking the financial risk.”

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